A Poverty of Spirit

JAMES J. KILPATRICK

October 01, 1990|By James J. Kilpatrick

WASHINGTON — SUPPOSE, to be supposing, that a poor family owns its home, that the home is air-conditioned, that it has a heated swimming pool or a Jacuzzi, and that family members have two cars to drive. May such a household be fairly described as ''poor''? Is this family living in ''poverty''?

Common sense provides one answer. The Census Bureau provides another. Last week the bureau released its annual report on ''poverty in America.'' The key figure that was picked up around the world -- the headline figure that editorial writers will seize and politicians will embrace -- is ''more than 30 million.'' These are statistically the nation's ''poor.''

The figure is bogus. To say that the Census Bureau is lying is unfair, but the statistic is grossly misleading. Robert Rector, a policy analyst for the Heritage Foundation, exposes the phony figure in detail.

Using data from the Bureau of Labor Statistics, the Congressional Budget Office and the Bureau of the Census itself, Mr. Rector demonstrates convincingly that the number of ''poor,'' by any rational definition, is only a small fraction of the ''more than 30 million'' that is officially proclaimed.

The dispute is easily explained. The Census Bureau counts only the ''cash income'' that is officially reported. Mr. Rector and his colleagues give account also to the in-kind benefits the Census Bureau ignores.

By way of example: A typical indigent elderly couple in New York in 1988 had no reportable income from wages, interest or dividends. But the couple benefited from SSI (Supplemental Security Income) and from public housing fairly valued at $12,290. In addition, the couple received Medicaid benefits of $7,548. At $19,838 the couple hardly was living in fat city -- not in Manhattan, Queens or Brooklyn, anyhow -- but were these oldsters living in ''poverty''? The Census Bureau says yes, they were, because the official poverty income threshold for elderly couples in 1988 was $7,704.

The bureau's simplistic statistics ignore not only welfare benefits but also material assets.

Mr. Rector notes that 38 percent of the ''poor'' own homes with a median value of $39,200. Nearly half of these households have air-conditioning; 98 or 99 percent have running water, flush toilets, electric lights and mechanical refrigerators; 81 percent have telephones; 31 percent have microwave ovens. Some 22,000 poor families have heated swimming pools or Jacuzzis.

It is instructive to compare ''poor'' here with ''poor'' somewhere else. Our official poor live in households that average 0.56 persons per room. The average Mexican household numbers 2.5 persons per room. The average Japanese family -- not the poor Japanese family, but the average Japanese family -- is 22 times more likely to lack an indoor toilet than a ''poor'' American household.

These material assets to one side, it is the bureau's refusal to count welfare spending that makes its annual announcement meaningless. Welfare outlays for ''means-tested'' families this year will amount to roughly $184 billion. The bureau counts only $27 billion in making its calculations. Entire programs, such as food stamps, public housing and Medicaid, statistically do not exist.

This vanishing act leads to a ludicrous conclusion. In 1988, Mr. Rector reports, the poverty income threshold for a family of four was $12,675. Before counting welfare benefits, 33.3 million persons were thus recorded as poor. After giving account to $184 billion in welfare benefits, the bureau found that 31.9 million were still poor. The figures add up to nonsense.

Anomalies abound. In 1986, according to the Census Bureau, the average annual income of the poorest 20 percent of U.S. households was $5,904. Yet these same households, according to this same Census Bureau, were spending an average of $11,477. Some of this could represent savings. Much of it comes from gray-market or black-market cash payments.

Mind you, we are talking statistics, not metaphysics. There are forms of poverty that have nothing to do with food stamps and reportable income. Millions of American households do indeed live in poverty -- a poverty of ambition, hope, love, education, self-esteem. As Mr. Rector properly observes, the welfare benefits that are statistically invisible have a visible consequence in the dependency they encourage. To be ''poor'' in America is to be materially better off than most ofthe world, but the deeper poverty remains.